Banks’ Demand at RBI Long-Term Repo Five Times Amount on Offer

(Bloomberg) --

India’s second long-term repo operation was bid five times the amount on offer as lenders locked in cheap one-year money from the central bank.

The Reserve Bank of India received 52 bids worth 1.23 trillion rupees ($17.1 billion), it said in a statement. The authority accepted 250.2 billion rupees.

The demand was however lower than the first auction which saw demand exceeding the funds on offer by nearly eight times, as lenders rushed to borrow three-year money at lower rates from the central bank.

READ: Demand for India’s Next Repo Issue May Be Less Than Blockbuster

The RBI is likely to do more LTROs beyond the one trillion rupees plan as international experience suggests that major central banks do not undertake just one round of unconventional measures, Standard Chartered Bank said in a note last week.

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